Aero-Flop Is Up To Regulator

Dale Smith, www.blacklocks.ca 
The final bankruptcy of Canadian-launched SkyGreece Airlines leaves passengers owed hundreds of thousands of dollars in claims. A passenger advocate said federal regulators were too slow in protecting consumers.

“What this case highlights for us as travellers is the oversight of airline finances is not sufficient,” said Dr. Gábor Lukács of Air Passenger Rights. “It’s very important that airlines have sufficient funds to actually fulfil their commitments to passengers.”

Lukács repeatedly petitioned the Canadian Transportation Agency to enforce regulations promising compensation for customers. The airline grounded flights last August 17. Regulators initially posted a website notice advising stranded passengers to call their travel agents, then issued a September 2 request that SkyGreece honour pre-paid tickets.

“The Agency is acting like a lapdog for industry rather than being a watchdog,” Lukács said. “I have the impression the Agency was embarrassed by public exposure into acting – eventually – and they orchestrated their action to be so late it had no practical effect.”

The Department of Transportation did not comment on the case. “The Agency is an independent, quasi-judicial tribunal,” a spokesperson said. “It would not be appropriate for the Minister to comment on its specific processes and decisions.”

SkyGreece was launched in 2014 by Montréal-area investors with Air Omega Holidays Inc. Its failure stranded passengers in Canada, Greece and Croatia. The airline had offered service from Montréal and Toronto to Athens, Thessaloniki, Budapest and Zagreb.

Regulators were “useless”, Lukács said, noting the Transportation Agency could have acted to secure the airline’s main asset – a Boeing 767 grounded in Toronto – to finance compensation for clients. “Obviously a new government cannot simply fire half of the Agency overnight,” he said. “But there are some serious problems with the Agency that the government would be wise to investigate.”

The airline attributed its financial difficulties in part to “Greece’s broader economic crisis”, but offered no explanation. Lawyers for SkyGreece earlier said passenger demands for compensation were too onerous; that the company had no cash assets; and that travellers would have to join other creditors in making claims.

Any federal order compelling SkyGreece to make special compensation to travellers “would have the effect of prioritizing passenger claims”, the airline’s lawyer wrote in submissions to the Transportation Agency.